- -9
petitioner and Gillette Tire showed that petitioner owed an
additional $261,392 to Gillette Tire.
A statement from Gillette Tire to petitioner dated June 1,
1990, shows a number of charges by Gillette Tire to petitioner
from May 10 to June 10, 1990, and the following payments or
credits to the account:
1055-A R 05/18/90 30088 -129,212.43
1875-A R 05/24/90 28824,29234.223 -4416.15
[blank] A 05/30/90 [blank] -387,637.30
The repair expenses which were claimed on Nikki's Federal
income tax returns for its fiscal years ending September 30,
1988, September 30, 1989, and September 30, 1990, were allocated
to Nikki's returns by Mr. John Gaeta (Mr. Gaeta), A&A's vice
president. Mr. Gaeta was also responsible for allocating other
expenses such as repairs, fuel, and insurance among the related
companies. The repair expenses were allocated to Nikki's returns
pursuant to the terms of the Nikki lease. The repair expenses
incurred by petitioner and the other related ready-mixed concrete
companies were allocated to the leasing companies' returns, just
as certain other expenses were allocated. For example,
petitioner had its own fuel pumps, and trucks of related
companies as well as petitioner's trucks used those pumps. Some
of the expense of the fuel pumps was later allocated to the other
related companies.
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